Hardware

Get the Android Phones Out Already

The time between announcements and product releases can be excruciatingly slow. Such is the case with the Android platform and Android phones. We've been teased with mobile applications and pseudo-demo phones running Android. But there are no handsets yet.

T-Mobile is now rumored to be ready to release an Android-based handset in the U.S. in late fall to coincide with the national rollout of its 3G network. This is generally consistent with what Google's Andy Rubin has been saying all along about a "second half" ('08) launch. It's just hard to wait.

HTC is the first confirmed OEM to be offering one. An HTC touch-screen phone paired with an Android OS (together with a range of software) could become a viable alternative for the mobile-Internet-interested unwilling to switch to AT&T (to get the iPhone).

But it all remains a matter of speculation unless/until the handsets ship.

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Wired offers a sneak preview of aspects of the 3G iPhone software.

Will Blackberry Steal the iPhone's Thunder?

Many handsets have claimed to be the iPhone killer. None have come close to living up to that label. However, the forthcoming all-touch-screen Blackberry Thunder, while not an "iPhone Killer," could provide the first truly viable alternative to the iPhone for loyal Blackberry fans.

Here are some screenshots, which make the device look impressive. What will increasingly separate the iPhone from its competitors, however, is the universe of software developers bringing rich, "native" applications to the device. Blackberry is aware of this and has launched its own fund to encourage software development.

However, as the leading U.S. smartphone many developers bring out Blackberry apps first (e.g., Google Maps with voice) to gain the broadest distribution they can as quickly as they can.

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Related: Does O2's UK experience suggest massive "pent up" demand for the iPhone for next week's US launch? There also appears to be real traction for the iPhone in the enterprise, which is a market share threat to RIM.

Nokia Formally Approved for Navteq Acquisition

Nokia was finally, formally approved for its $8 billion acquisition of mapping provider Navteq. Navteq will become the core of Nokia Maps. The acquisition is consistent with Nokia's broader diversification strategy, seeking to remake itself as an "Internet company."

Navteq straddles both the destkop and mobile by providing mapping data, content and eventually advertising on the desktop, PNDs and in mobile.

Google Introduces Voice Search for Blackberry

From the Google Mobile Blog:

Using your voice to search for businesses is super useful in situations when you can't type, when the name of the business is long, or when you're not sure how to spell it. In other situations -- when you're in a library or a rock concert, for example -- typing makes more sense. Keeping that in mind, we designed this feature to allow you to choose whether to speak or type. Get it now on your BlackBerry Pearl by visiting http://www.google.com/gmm.

Built on the same speech recognition engine used for Goog411, Google Maps with voice search is very much like the Tellme service for Blackberry or Live Search with voice, as well as applications from V-Enable, Vlingo/Yahoo!, Nuance and others.

Google had been the last of the major providers without true "voice search," putting Goog411 aside. Now all the major Internet brands have or are integrating voice in mobile (save AOL).

It will ultimately drive more search and usage frequency. Recall that ChaCha reported 40 queries per month among many of its users and up to 150 for its heaviest users. This is about voice and its ease of use.

iPhone Frenzy Redux

July 11 is the date set for the release of the new iPhone. Smart shoppers will go to AT&T and not Apple stores to obtain one. Amid lowered sales forecasts, investment firm RBC published consumer research (via Silicon Alley Insider) that indicates high levels of apparent demand for the 3G iPhone. Among the data excerpted from the RBC research note:

  • 56% of those planning to buy a smartphone in the next 90 days plan to purchase an iPhone, up from 35% in March.
  • Purchase interest in Apple is 2x or more that of other brands surveyed: RIM 23% (RIMM), Palm 3% (PALM), HTC 2%, Nokia 2% (NOK), Samsung 2%, Motorola 1% (MOT), others 11%.
  • Top reasons for buying the iPhone include lower price (67%), 3G Internet connection (63%), GPS (47%), Microsoft (MSFT) Exchange email support (35%), and third-party apps (20%)

BusinessWeek offers a visual preview of some of the forthcoming 4,000 "native" applications developed for the iPhone. And the Register speculates about whether the iPhone will eventually adopt a QWERTY keyboard. (Voice control/input is the solution for those who don't like the keyboard.)

Sprint's Instinct Has Real Limitations

While waiting a considerable length of time for the software upgrade to my HTC Windows Mobile phone in a local Sprint store, I had an opportunity yesterday to get "hands on" with the Sprint Instinct. After hearing all the hype and tales of sell-outs I was eager to see it.

I spent about 20 minutes with the o'er-hyped device. However my comments below don't rise to the level of a full-blown Walter Mossberg-like review:

I found its email system and Web browser to be less sophisticated than the iPhone's or the BlackBerry's. I also thought the phone's onscreen keyboard was harder to use than Apple's. It would flip unpredictably from landscape to portrait mode. The Instinct does allow handwriting recognition as an alternative, something the iPhone doesn't.

If you're a devoted Sprint customer, or want to avoid AT&T, the Instinct is an OK choice. But it's no iPhone.

I agree with the Mossberg review that it's a poor substitute for the iPhone. Had the iPhone not come along the standard of comparison would be quite different. However we can't turn back the clock and in that context it simply doesn't live up to the hype.

I didn't test the video and image aspects of the phone but I spent a fair amount of time on the Internet and playing with other features of the device. It can be customized and has a nice interface and look and feel but it's quite limited by comparison to the much more robust iPhone. Most importantly perhaps, it doesn't have a software ecosystem around it, as the iPhone now does.

Beyond core usability it's this ecosystem of developers that will likely separate the winners and losers in the smartphone market going forward. Blackberry knows this, Nokia knows this (hence Symbian open source), Microsoft knows this, Google and Yahoo do too. However there is a scenario where the ecosystem doesn't matter as much if next-generation mobile browsers make the entire Internet truly accessible on mobile devices. In that case phone (and camera) features could be quite competitive with the iPhone.

Skyhook Announces 'Hybrid Positioning System'

Skyhook wireless, which came to national attention through incorporation of its technology into the iPhone, is announcing a combined location-awareness technology that takes Wi-Fi positioning and combines it with GPS and cell tower triangulation (for mobile handsets):

Skyhook Wireless is delivering the most advanced positioning system in the world by combining ground breaking positioning algorithms along with comprehensive environment survey data. XPS builds on top of the revolutionary Wi-Fi Positioning System (WPS) that is already deployed on tens of millions of mobile devices worldwide. The original version of XPS delivered "multi-mode” location switching between WPS and GPS readings based on availability and error estimates. XPS 2.0 combines raw Wi-Fi, GPS and cell tower readings to produce a single hybrid calculation.

People often fail to understand the limitations of GPS, illustrated here by Nokia:

GPS 1

GPS 2

A hybrid system like this -- the only one in existence apparently -- will speed location detection and make it more reliable accordingly. This technology will be available on handsets that ship in 2009 and 2010 according to Skyhook CEO Ted Morgan.

Handset Wars and Woes

But for the Centro Palm is failing:

Smartphone sell-through for the quarter reached a record high, totaling 968,000 units, up 29 percent year over year . . .

Revenue for the full fiscal year 2008 was $1.32 billion. Smartphone sell-through for the full year reached a record high, totaling 3.2 million units, up 19 percent year over year.

Net loss applicable to common shareholders for fiscal year 2008 was $110.9 million

This is the fourth loss in a row for Palm, who's Treo is all but dead, having ceded the market to Blackberry and Apple. The Centro is the one bright spot, but it's a very low margin product -- the guts of the 755 but without the profit.

Blackberry had strong sales and increased market share but just missed estimates (shares lost ground). According to Bloomberg:

The BlackBerry's share of the U.S. market for advanced handsets grew to 44.5 percent in the first calendar quarter, from 35.1 percent in the previous three months, according to Framingham, Massachusetts-based research firm IDC. Palm lifted its share to 13.4 percent from 7.9 percent. Apple's share fell to 19.2 percent from 26.7 percent.

And this morning Sony Ericsson issued a warning:

Sony Ericsson Mobile Communications AB ("Sony Ericsson") announces today that its net sales and net income before taxes in the second quarter of 2008 continue to be negatively affected by moderating demand of mid-to-high end mobile phones, in combination with a delay of new products shipped during the quarter.

All this comes as Apple prepares to release the 3G iPhone in the next two weeks. Do the high volume of searches indicate strong consumer interest will turn into strong sales? Search is always touted as a predictor of market outcomes, this will be an interesting test case.

Sprint Had a Good Instinct

The Samsung Instinct has apparently been selling extremely well for the company, even leading to shortages. According to a press release:

Just a few days after hitting store shelves, Samsung Instinct has become the fastest-selling EVDO handset in Sprint history. Instinct was first available exclusively to current Sprint customers on June 19 breaking records for the initial launch of any Sprint product. Instinct became available to all customers on June 20; sales continued to be brisk with Instinct breaking Sprint's record for the first week of sales for any device.

The record pace of Instinct sales has led to temporary shortages of the device at some locations across the United States. Sprint and Samsung are diligently working around the clock to increase inventory in all sales channels. Samsung has increased efforts to deliver new supplies of Instinct on a daily basis and manufacturing plants are operating at full capacity to keep up with the demand.

The brisk sales reflect the touch-screen iPhone-like appeal and the growing demand for access to the mobile Internet, which is how the device is positioned. (Sprint is paying people $20 to put the phone in "home movies" that they upload to YouTube.)

Meanwhile over at Verizon yet another touch-screen, iPhone clone (the LG "Dare") is being released. It's claim to fame is video but it lags in other areas.

Vlingo Now on Blackberry Devices

Vlingo, which came out of the gate with a high visibility deal with Yahoo, is now independently expanding. Today's announcement is about the availability of Vlingo for Blackberry devices. It must be downloaded but allows the following:

  • Voice Dial. Initiate calls to anyone in your address book.
  • Text Message. Send text messages without typing.
  • Email. Simply speak "Email John Smith" to start an email on-the-go, and you can speak the body of the message as well.
  • Applications. Open calendar, maps, etc.
  • Address Book. Search for contacts without typing.
  • Web Search. Look up anything online in one step. Just say, "Web search: concert tickets in Boston," and the results are displayed.
  • Note2Self. Send yourself a reminder in the form of an email, task or text message.

You can see a short video demo here. The company also has a deal with CallGenie.

We believe that speech/voice control is a killer app for mobile and will (together with cheaper data plans) dramatically broaden the usage frequency of the mobile Internet and mobile search.

Before we changed the name to Local Mobile Search we were calling this service, Speech-Enabled Mobile Search.

Nokia to Make Symbian Open Source

The Symbian mobile OS is not written about or discussed as much as the iPhone or Blackberry or Android, but it's the world's dominant smartphone platform. The company that owns it, Symbian, was established in 1998 by a consortium of mobile handset makers and technology providers to license the software. Here's the current ownership structure: Ericsson (15.6%), Nokia (47.9%), Panasonic (10.5%), Samsung (4.5%), Siemens (8.4%) and Sony Ericsson (13.1%).

Nokia is now buying out everyone and going to contribute the software to a foundation, which will make it open source:

To enable the Foundation, Nokia today announced plans to acquire the remaining shares of Symbian Limited that Nokia does not already own and then contribute the Symbian and S60 software to the Foundation. Sony Ericsson and Motorola today announced their intention to contribute technology from UIQ and DOCOMO has also indicated its willingness to contribute its MOAP(S) assets. From these contributions, the Foundation will provide a unified platform with common UI framework. A full platform will be available for all Foundation members under a royalty-free license, from the Foundation's first day of operations.

Contributions from Foundation members through open collaboration will be integrated to further enhance the platform. The Foundation will make selected components available as open source at launch. It will then work to establish the most complete mobile software offering available in open source. This will be made available over the next two years and is intended to be released under Eclipse Public License (EPL) 1.0.

The Foundation's platform will build on the leading open mobile software platform, with more than 200 million phones, across 235 models, already shipped by multiple vendors and tens of thousands of third-party applications already available for Symbian OS-based devices.

What's amazing is how quickly the mobile world is moving toward open-source software platforms: Android, LiMo and now Symbian. Blackberry and iPhone remain proprietary systems but are in some ways protected from this trend, especially the iPhone. However, Windows Mobile may be the one that is most vulnerable.

Based on Q4 sales, here's the smartphone market share hierarchy:

  • Symbian (65%)
  • Windows Mobile (12%)
  • RIM/BlackBerry (11%)
  • iPhone (7%)
  • Linux (5%)
  • Palm

Android Gets Pushed Back

Android

The Wall Street Journal has a general discussion of delays and problems afflicting Google's open mobile platform Android. There are no revelations; everything is just taking longer:

T-Mobile USA expects to deliver an Android-powered phone in the fourth period. But that launch is taking up so much of Google's attention and resources that Sprint Nextel Corp., which had hoped to launch an Android phone this year, won't be able to, a person familiar with the matter said.

China Mobile, the largest wireless carrier in the world with nearly 400 million subscriber accounts, had planned to launch an Android phone in the third quarter but it has run into issues that will likely delay the launch until late this year or early 2009, a person familiar with the matter says.

Meanwhile, the Android software has yet to win broad support from large mobile-software developers. Some say it is difficult to develop programs while Google is making changes as it finishes its own software.

The challenge, pardon the pun, is apparently too many moving parts. Hardware makers seem more ready and able to deliver the phones to carriers than carriers are to the broader market. Meanwhile, Apple's 3G iPhone is poised to capture iPod-like status in the mobile market. (Things like Mercedes integration contribute to that.)

Google unveiled some early Android applications at a developer conference earlier this month.

Exploring Barriers to iPhone Adoption

Comparison Shopping engine PriceGrabber (now owned by Experian) has released some interesting data about iPhone interest and intent to purchase, gathered from an online survey and user-behavior on its site (U.S.). The survey was conducted from May 20 to June 3, 2008 (prior to the iPhone 3G announcement) and had a total of 3,066 respondents.

Interest in the iPhone has been consistently high, according to click thoughs on PriceGrabber:

CTRs to phones

The two principal barriers to iPhone adoption, as we've discussed many times here, are cost and AT&T carrier exclusivity in the U.S.:

Intent to purchase iPhone

According to PriceGrabber, among the 54% who "do not intend" to purchase an iPhone:

  • 41% said the primary reason was that the iPhone is too expensive
  • 22% said hat they didn’t want to switch to AT&T as their carrier

Again, this survey was done before the $199 3G iPhone was announced, so the "primary" objection has now presumably been removed. AT&T's exclusivity (or contract with an existing carrier) remains a barrier for many however. But AT&T's favorable ratings are at parity with Verizon among PriceGrabber users:

Carrier preferences

Among the major U.S. carriers, all added subscribers in Q1 except Sprint, which lost a million to others (Verizon, AT&T, which together added 2.8 million). The data in the table above indicate Sprint faces potential further losses as more subscribers move to the top two carriers. Sprint's "iPhone Killer" Instinct is unlikely to compete successfully against the iPhone, although it may help retain some subscribers.

Specifically regarding the 3G iPhone, here's what the PriceGrabber survey showed:

3G intention

Those same figures broken down somewhat:

Intent to purchase next gen iPhone

Among those considering a 3G iPhone, 34% said they wanted to wait and see. Again, this survey was before the formal announcement. Some number of those people may have been swayed. Perhaps more interesting is the 36% who say that they're inhibited by their contractual commitment to their existing carrier. That suggests this group is part of the "addressable market" for the iPhone in the future.

Considered in this context, a total of 74% of survey respondents indicated interest in the device, which is a striking figure.

Loopt Now on Blackberry, Coming to iPhone

Loopt, one of the first mobile-only social networks, announced that it was available now on Blackberry:

Loopt, a revolutionary social-mapping and communication service, announced today that the location- based service is now available for free to BlackBerry users on the Sprint, Alltel, T-Mobile and AT&T networks. BlackBerry users can now share their location information with friends across multiple devices and carrier networks.

The company also has an iPhone version coming out. Right now there's limited usage among mobile subscribers of mobile social networking. But we see this (or social features on mobile apps) as a category with significant potential.

Interest in mobile social capabilities

Source: LMS/Multiplied Media, 2008 (n=862)

The questions revolve around whether the companies can rise above the noise in the sector and/or can hold out until the users show up. There's also the question of whether these firms can monetize their usage effectively. For the near term they'll have to tap into ad networks or other sources of locally targeted ad inventory.

However, the agencies and advertisers haven't yet caught up to the technology and its targeting capabilities. So the "inventory" doesn't yet exist for the super-targeting that mobile phones with GPS allow.

Nuance OVS - Promises Voice Search for iPhone in August

No pricing is available but Steve Chambers, president of the Nuance Mobile business unit has demonstrated Open vSearch (or OVS) speech-enabling Web search on the iPhone. A demo can be seen here. While it is not substantially different from the offerings of Vlingo, V-ENABLE or Microsoft Live Search in terms of using speech input and distributed speech processing (DSP) to recognize utterances and populate a search box, it is no coincidence that the announcement coincides with Apple's World Wide Developers Conference (WWDC) here in San Francisco.

It was at WWDC yesterday that Steve Jobs announced the new, 3G-compliant, less expensive iPhone and began enticing Apple's true believers with the capabilities of a faster data link, longer battery life, GPS and a larger user base (thanks to the lower price). We expect to see some formidable new speech-enabled multimodal applications for the new generation of iPhones. It's impact far exceeds the share of the mobile subscriber base.
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P.S. from Greg: I've been using the Microsoft Live Search application with voice much more recently and have become very pleased with the performance. Voice/speech of course addresses many of the shortcomings of keypad entry on mobile phones, although it's imperfect. It also helps drive consumer search volume as well because of the reduced "friction."

iPhone PR: Money Can't Buy That Kind of Publicity

One of the things that put Skyhook Wireless on the map from a PR perspective was Apple CEO Steve Jobs' mention of the company on stage earlier this year, discussing the iPhone SDK. Money can't buy that kind of publicity, to paraphrase Skyhook CEO Ted Morgan.

Also in that camp today is Loopt, the mobile social network and friend finder. The company's CEO Sam Altman did an iPhone demo on stage in San Francisco. We'll see if Whrrl gets a mention as well.

A range of apps, from SEGA, to eBay, Loopt, AP and TypePad have shared the stage so far . . .

Jobs: 98% of iPhone users are doing mobile browsing (of the Internet). He confirms the 3G iPhone. Says iPhone 3G is faster than other 3G phones, cites Nokia and Palm. Jobs says "3G speeds approach WiFi."

He also confirms the price cut and GPS (combined with WiFi and cell tower triangulation). There's also extended battery life beyond iPhone 1.0. Jobs touts location-based services and content on iPhone 2.0.

Jobs says they're will be distribution in 70 countries around the globe for iPhone 2.0.

Jobs announces the new price: $199 for 8G with a 16G model for $299. That's going to drive huge sales globally. Release date is July 11 in 22 countries.

iPhone price cut

image credit: Engadget

iPhone 3G: Game Changer Part Deux

The first iPhone changed the mobile Internet and mobile hardware forever; the new 3G GPS $199 iPhone will cause more consumer gain, competitor pain. The combination of ingredients here makes this device all but unbeatable, especially given the third party applications that nobody else currently has -- although Blackberry and Android are working on it.

In the end, it may be the apps that really make the iPhone desirable to users even more than the device itself.

But for the AT&T exclusivity, the iPhone would be the iPod of phones (meaning a brand that overshadows others). Let's see what the response is from other carriers and handset makers. Suddenly the HTC and Samsung devices (Touch Diamond, Instinct) look relatively pale by comparison.

Here's the AT&T press release just out a few minutes ago.

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UK carrier O2 makes the new iPhone "free" for "selected tariffs," meaning those in particular higher-cost plan categories.

Get Ready for iPhone Week

Now that speculation and anticipation are at a fever pitch among iPhone watchers, the Financial Times all but confirms the 3G iPhone will be subsidized like conventional mobile phones:

Apple has bowed to pressure from mobile phone operators and agreed they can subsidise the latest iPhone, expected to be unveiled by Steve Jobs, Apple’s chief executive, on Monday.

The subsidy arrangements should increase Apple’s chances of hitting its target of selling 10m iPhones during 2008. The target has been made challenging by the global downturn. Apple has reported selling 1.7m iPhones so far this year.

Apple has accepted that the new iPhone should be subsidized in the US and western Europe by the mobile operators who sell it to consumers, according to people familiar with the matter.

A subsidy will broaden the appeal of the device in the US and internationally. However, the exclusive relationship with AT&T in the U.S. still represents a significant barrier for many people who would otherwise buy the iPhone. Reportedly 47% of iPhone buyers in the U.S. changed carriers to get access to the device.

Some additional recent facts about iPhone user behavior from Nielsen Mobile:

  • 25- to 34-year-olds are the largest group (1/3) of iPhone users
  • A quarter of iPhone buyers use their iPhones for "business," indicating strong enterprise potential
  • The iPhone's iPod function is the most popular
  • 76% of users send e-mail with their iPhones; 33% use IM on the phone
  • 68% use the WiFi capability of the device, indicating people are seeking greater speed
  • 37% of iPhone owners watch video, dramatically higher than the general mobile average

Here's previous information about iPhone user behavior and habits.

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Yet another touch screen iPhone competitor: the Samsung Omnia.

RIM Promotes Local Search on Scavenger Hunt

RIM is producting the "Blackberry Curve Challenge" (scavenger hunt) to promote the Curve and local mobile search capabilities of the device:

A fun, high-energy race through these amazing American cities – Boston, Minneapolis, Portland and San Francisco! It’s a one-of-a-kind experience where you’ll flex your physical and mental muscles in a scavenger-hunt style race using a new BlackBerry Curve 8330 smartphone with Verizon Wireless service! Top teams in each city will receive a BlackBerry Curve 8330 smartphone. And the winning teams from Boston, Minneapolis and Portland win a trip to San Francisco to compete in the Ultimate Challenge: Alcatraz Island!

Take that iPhone! Perhaps this is a reality TV show in the making :)

iPhone Frenzy Redux

We'll start seeing the first iPhone applications early next week. If they are sufficiently diverse, useful and just plain old "cool" they could accelerate the device's momentum and the "must have" factor.

Over at Barrons, some iPhone sales forecasts and speculation:

Pacific Crest’s Andy Hargreaves today asserts that the numbers have gotten out of hand. He points out in a research report this morning that the carriers that have announced deals with Apple have total subscribers of 669 million people, an increase of 520 million in the last month. That’s impressive: global handset sales are expected to 1.27 billion this year, growing to 1.37 billion next year. But to state the obvious, not everyone wants a smartphone. “A substantial majority of these subscribers should not be considered potential iPhone purchasers,” he cautions. Hargreaves forecasts global smartphone sales at 61 million units this year, and 81.3 million next year; of that he sees Apple taking 17.2% share this year, and 18.8% next year. That comes to 10.5 million units in 2008, and 15.3 million in 2009.

Apps, as I suggested, could boost sales. Price will also be a factor. If the rumored subsidy shows up then sales will be further accelerated. AT&T exclusivity remains a problem and sales barrier in the US, though less so around the world.

The iPhone needs to remain strong to continue to pressure others in the market to improve usability. If it can then the rest of the market will follow (as it is with touch-screen devices) and all consumers will benefit.